On inertia, garages and the future of ERP

Disrupting yourself is vastly preferable to having the industry disrupt you

Hooray for innovation!

Now the new mantra in enterprise is “Innovation”. You can see CEOs screaming it from the tops of buildings. You can see sales guys spray painting it over their old sales material, and you can see IT people stumbling through the halls mumbling “I have an iPhone, I am super innovative. Look, I can see my email *nervous giggle*”.

Speed is the new currency, innovate our way to growth, tap unmet consumer demand – these are the mating calls of business leaders who are not exactly sure what they are going to do but are pretty sure it isn’t what they are doing now. The first to hear these confused cries from business leaders are of course strategy and consulting firms. PowerPoint presentations start appearing with sentences like “businesses that innovate show increased share performance over those that don’t” (this is a real example from a strategy firm who should know better).

The word goes out within an organisation that from this point on we are innovative and don’t you forget it. Business leaders start noticing that the guys who really seem to have a handle on this innovation nonsense seem to be the guys who worked their way out of their parents’ garages and turned their project into a successful enterprise. They seem to have a ‘more with less’ attitude that resonates with a resource constrained business and they start snapping up this talent whenever they can, even going to the extent of buying some of these businesses in order to inject new DNA into their teams.

The kids who built up the business are delighted. They can afford all the mixed sweeties they like from now on and they feel a sense of pride that their thinking would be so valued as to be integrated into the mother ship of a large corporate. The honeymoon is quickly over, usually around the same time that the CIO assures the new team members that he loves their little project, how many MIPS would you like on our mainframe, and what is your SAP integration strategy?

Amongst the many generalisations and stereotypes I have blatantly abused in the above, there are simple truths which highlight the need for change in the enterprise technology landscape.

We must fight the inertia of our previous success, as individuals, functions and whole companies. Disrupting yourself is infinitely preferable over having the industry disrupt you.

Innovation is, of course, important to the future of your business. This hasn’t happened just recently, it always was the case. However, innovation is an inherently uncontrollable process – 99 per cent of people are terrible at it and are much better off concentrating on service efficiency and incremental change.

Of the one per cent of people who are good at it, half of them are incapable of overcoming business inertia in order to enact a transformative change, even if their idea is a brilliant one. This is mostly as a result of the inertia of previous success.

ERP is heading towards a creative disruption cycle. The industry is holding its breath to see where this change will originate from but it is very unlikely to be from sources that we currently suspect such as web 2.0 style businesses. ®

Warren Burns has held senior global roles at Universal Music and the consumer goods giant Unilever, where he served as Head of Innovation and was responsible for leading the Global Innovation practice and was instrumental in delivering high profile projects such as the future Ice Cream Cabinet.

Warren also holds advisory board positions for a number of Australian businesses and is a research associate for the Leading Edge Forum Executive Advisory Programme.

His consultancy, BurnsRED, helps customers understand how emerging technology will impact their business.